🍊 The Cannabist Company (mostly) Exits Florida for $16.4M
🍊 The Cannabist Company (mostly) Exits Florida for $16.4M
Cannabis Legalization to appear on November Ballot in Nebraska. AWH terminates CEO and CFO. Ohio dispensaries sold ~$10.5M in 3rd week of AU. Gold Flora closes Senior Loan Facility for up to $13.15M.
🗣️ I’m working on a ~50-person event during Benzinga Cannabis Capital Conference (October 8-9), if you’re interested in attending or sponsoring, let me know
🏈Also, if you’re interested in joining a Fantasy Football League (draft on Wednesday before season kicks off) with other Highly Objective friends, let me know
👋 Enjoy the long weekend!
🌿 Industry
Medical Marijuana Legalization In Nebraska May Appear On November Ballot. Nebraska’s top election official says organizers have gathered enough signatures to get the issue of legalizing medical marijuana on the November ballot — ABC
Nebraskans for Medical Marijuana announced earlier this year that it had gathered about 114,000 signatures — well more than the ~86,000 needed — for each of two petitions: one that would allow marijuana for medical use and the other to regulate the medical marijuana industry in the state
In 2020, the group came close after meeting signature requirements. But opponents sued, arguing that it violated state rules requiring ballot measures to focus on a single question. Instead, they argued, the measure posed two separate questions: whether residents should have the right to use marijuana for medical purposes, and whether private companies should be allowed to grow and sell it.
The state Supreme Court sided with the effort’s opponents and prevented it from going to voters
In 2022, with only months to do so, organizers failed to collect enough signatures to get the question on the November ballot
Ohio adult-use cannabis retailers fined $212,000 for violating marketing rules. Ohio regulators issued more than $200,000 in fines to five cannabis retailers for violating marketing and promotional restrictions surrounding the Aug. 6 launch of adult-use sales — MJBizDaily
According to Cleveland.com, the state’s Division of Cannabis Control issued the following penalties:
$150,000 and a $12,500 fine to Greenleaf Apothecaries (The Botanist), for using an ice cream truck to advertise recreational sales, employee social media posts touting free ice cream as well as signage larger than permitted
A $12,500 fine to Bloom Medicinals for using a sign larger than 16×18 inches and one unattached to its store
A $12,500 fine to GTI (Rise) for disseminating a promotional email in June alerting medical marijuana patients that cannabis would be available for adult-use and MMJ patrons as of June 10 – nearly two months before recreational marijuana sales kicked off
A $12,500 fine to Standard Farms
A $12,500 fine to Guaranteed Dispensary
The other infractions include minor violations, including using “recreational” in promotional materials and misidentifying license status
New York acting cannabis chief says changes made in wake of OGS report. The acting chief of the state's Office of Cannabis Management has started to impose changes in the troubled department — Spectrum
The May 10 report found the department failed to grant cannabis business licenses to 90% of applicants and other issues in the agency's structure and communication habits, which led to the ouster of former Executive Director Chris Alexander
Department staff will continue to evaluate about 600 applications that remain in the randomized queue from the November group through early next year, Reid said. Afterward, applications in the December queue will continue to be evaluated on a rolling basis
Marijuana Is Too Strong Now. As weed has become easier to obtain, it has become harder to smoke — The Atlantic
In 2022, the federal government reported that, in samples seized by the Drug Enforcement Administration, average levels of THC had more than tripled compared with 25 years earlier, from 5% to 16%
The simplest explanation for this is that the casual smokers who pine for the mids and reggies of their youth aren’t the industry’s top customers. Serious stoners are
If the incentives of the market point to ever-higher concentrations of THC, one path to milder varieties would be government regulation
California Recalls Two More West Coast Cure Cannabis Products. The Department of Cannabis Control took vape cartridge and live resin diamond batches off the market, citing the presence of chlorfenapyr — CBT
The WCC products recalled Aug. 29 include:
A “CUREpen premium THC oil” vape cartridge that was sold on or after Sept. 14, 2023, at 93 licensed dispensaries in 25 counties
A “live resin diamonds” concentrate sold on or after Nov. 2, 2023, at 105 retail locations in 30 counties
These two recalls come after the DCC issued mandatory recalls July 2 for five WCC vape cartridge products
Home Depot will stop testing workers for Cannabis and limit drug screening for most employees, Internal Memo shows
Public Policy Polling (PPP) signals Florida’s Amendment 3 prospects of approval are tight, with 57% of registered voters in favor of the proposal, while 34% are opposed
New York sold $100M worth of cannabis in Q1 2024 and $160M in Q2 2024 across 165 dispensaries
Ohio dispensaries sold ~$10.5M in adult-use marijuana in the third week of sales between 8/18–24 across 121 dispensaries
Arkansas medical cannabis sales down 4% from last year
THC seltzers quietly find a foothold in cannabis-cautious South Dakota
💵 Deals
The Cannabist Company to Sell Florida Assets for $16.4M. A Leading MSO will acquire one Cultivation facility, while a Joint Venture between MINT Cannabis and Shango will acquire all 14 Cannabist Dispensaries in Florida and two Cultivation and Manufacturing facilities for $16.4M. The Cannabist Company will retain one MMTC License. The Cannabist Company has entered into a definitive agreement to divest the Lakeland cultivation facility (Lakeland Transaction) for $11.4M, payable in cash. The transaction includes a 40,000+ sq ft cultivation facility in Lakeland. Additionally, The Cannabist Company entered into a definitive agreement with Mint Cannabis and Shango Cannabis, as joint venture partners (MINT Shango JV), to acquire all 14 Cannabist dispensaries in Florida and the Company’s cultivation and manufacturing facilities in Alachua and Arcadia (MINT/Shango Transaction). Consideration for the MINT/Shango Transaction, subject to adjustment, is $5M. Upon closing, the MINT Shango JV will pay closing consideration of $3M in cash and issue a $2M promissory note. Post-closing, dispensaries are expected to be rebranded to “MINT Cannabis.” Additionally, the MINT Shango JV will transfer to The Cannabist Company all outstanding equity interest in its MMTC license entity, which the Company expects to divest to an additional third party. Transaction includes 14 Cannabist dispensaries, Two (2) cultivation and manufacturing facilities, The Company’s MMTC license
Gold Flora closes Senior Loan Facility with J.J. Astor for up to $13.15M, with an initial draw of $7.15M and the potential for up to three additional $2.0M draws. The proceeds of the Loan Facility will be used primarily for working capital and other corporate purposes. The Loan Facility allows potential gross proceeds of ~$12.6M, provided that each Additional Draw is exercised by the Company and the applicable conditions precedent are satisfied, with each Additional Draw available in sixty day increments from the closing of the Loan Facility. The Initial Draw will be repaid within 53 weeks with total payments of approximately $9.3 million. Each Additional Draw will be repaid within 40 weeks with total payments of approximately $2.8 million. Upon any event of default, the lender may elect to accelerate payment subject to a default premium and/or convert into shares of Gold Flora common stock, subject to certain limitations and cure periods, including applicable pricing and dilution limitations of the Cboe Canada
Jushi Files Base Shelf Prospectus for up to C$350M Offering. The Shelf Prospectus will allow the Company to offer up to C$350M of subordinate voting shares, preferred shares, subscription receipts, debt securities, convertible securities, warrants and units, or any combination thereof, in Canada from time to time during the 25-month period that the Shelf Prospectus is effective
SNDL succeeds in bid to purchase Indiva under CCAA with stalking horse bid. Indiva is a producer of cannabis edibles in Canada and produces products across a wide range of brands, with a portfolio of 7 brands and 53 SKUs, all manufactured in the Company's 40,000 sq ft production facility in London, Ontario
📄 Company Updates
RIV Capital Q2 Net Loss of ($8.3M), cash of $57.7M, with another $15M earmarked to also be able to sell adult-use cannabis in NY, the company has paid the first $5M. More money will be paid upon opening additional co-located dispensaries
StateHouse Q2 2024 Net Revenue Increased 10% to $27.8M (50.8% GM), Adjusted EBITDA of $4.9M, Net Income of $0.2M
SLANG Q2 2024 Revenue of $6.3M, compared with $8.4M for Q2 2023, a 26% decrease YoY, EBITDA of ($2.1M), $6.7M in cash
POSaBIT Q2 Revenue increased 13% sequentially to $4.2M but was down (69%) from the same period last year, cash of ~$1.1M
Trulieve partners with Professional Pickleball Association and Major League Pickleball. The company will sponsor premier pickleball events in Arizona, Florida, and Georgia. The Professional Pickleball Association stands as the largest professional and amateur pickleball tour in the world, boasting an impressive 25 tour stops nationwide. With over 39,000 amateur players and a 50% growth in registered players from 2022 to 2023, the PPA Tour has also captured the attention of over 275,000 spectators and 20 million fans watching on broadcast in 2023, solidifying its status as a premier sporting event
Grown Rogue commences Phase I operations by ABCO in New Jersey. Grown Rogue owns a 44% equity interest in ABCO, holds an option to acquire an additional 26% for $720,000, and has the right to acquire all remaining equity at FMV
Wana Brands Launches Wanderous by Wana, a New Online Marketplace for Direct-to-Consumer Hemp-Derived THC and CBD Products. Wanderous offers a curated selection of gummies and infused beverages in a wide variety of flavors, dosages and formulations—shipped direct to your door. Initially, Wanderous will feature Delta-9-THC products and non-intoxicating CBD gummies from six best-in-class brands: Wana, Cann, Happi, Charlotte's Web, Martha Stewart CBD, and MXXN
🏬 Retail
Tokyo Smoke to close 29 stores amid creditor protection proceedings. The closures are part of a restructuring the brand is carrying out under the Companies’ Creditors Arrangement Act. Tokyo Smoke says the moves are meant to better align its operations with the current cannabis market and regulatory conditions, which the company says have changed “significantly.” Approximately 167 locations remain open and operating in the normal course, through its various retail programs, with no changes to online business or loyalty program. OEG Retail Cannabis, a company run by the owner of the Edmonton Oilers hockey team, bought the Tokyo Smoke brand from Canopy in September 2022
The Village opens Hoboken, NJ’s third dispensary. The first one to open was The Station opened in late October 2023 while Blue Violets is just a block away
AYR Cannabis Expands Retail Footprint in Florida with Two New Dispensaries. The openings of the Jacksonville-Dunn and Palm Beach Gardens stores will expand the Company’s retail presence to 66 locations in Florida, and 96 locations nationwide
Trulieve opens 144th dispensary in Orlando, FL. Along with additional dispensaries in Florida (Miramar Beach, Niceville, Tampa and Cocoa), bringing it to 148 dispensaries
🌱 Product
Country Cannabis partners with three-time Grammy Award-winning producer and music icon Shooter Jennings. The proprietary strain, Snake Mountain, was developed through a close collaboration between Country’s cannabis experts and Shooter Jennings to build a preroll blend that inspires creativity and “unleashes your wild side”
Curaleaf Launches JAMS Remix Fast-Acting Ratio Jellies. Crafted by food scientists, product innovation experts and formulation specialists, the suite of JAMS Remix jellies includes the following mood-enhancing edibles for a variety of customers and patients, including benefit seekers, ratio enthusiasts, and canna-curious consumers
🧔 People
AWH terminates CFO, CEO amid refinancing push. CEO John Hartmann and CFO Mark Cassebaum were terminated, effective immediately. Director Samuel Brill is stepping in as CEO, while Roman Nemchenko, previously Chief Accounting Officer, has been appointed as CFO. AWH has also tapped Director and Co-Founder Francis Perullo to serve as President. Both Hartmann and Cassebaum are departing after relatively short tenures in their respective roles, with Hartmann serving as CEO for just over a year after taking the seat in May 2023. Cassebaum, meanwhile, is departing after 10 months as CFO after joining last November
Maryland Cannabis Administration Director Will Tilburg departs. He is widely credited with the smooth implementation of the state’s adult-use cannabis market
🎙️ Interviews
Under the Hood of Cresco ft. Zach Marburger | The Dime
Ayr CEO David Goubert on FL, OH and Q2 | Cannabis Investing Podcast
Lauren Carpenter: The State Fair and Normalizing Cannabis Consumption | CannaBiz
i think ayr is the acquirer of the cannabist cultivation facility in lakeland. ceo mentioned expansion there for florida rec on podcast, and unsure if they have anything existing.
some may have heard of ayr's other greenhouse disaster in florida, so....